Wall Street: Ford Stock Settles in the $2.00 Range
Story by Sam Haymart
After some wild weeks prices have stayed more stable.
10-13-08:
Since we reported the wild drops of Ford stock (F) each day in the second week of October during the Wall Street drama, things have leveled out somewhat. There have been some ups and downs including today where the DOW saw its second highest rise in history.
Ford stock has remained stable in the low $2.00 range for the past week and half, closing up slightly today at $2.15. While is isn’t at all exciting if you were one of the many who bought a long time ago when it was $5, 8, 10, or $15 or more a share, it is good news to see the bleeding stop for a while.
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In a shocking move last week Ford’s largest private investor Kirk Kerkorian shed some 7 million shares of the stock he purchased over the summer for $8.50 per share. At the $2.00 and change, his losses were close to $46 million on that sale alone. The news of his voluntary blood letting made some on Wall Street wonder whether he knew something others didn’t.
In the following days news came that he had stated his sale was a result of concerns he had about recent retirement of CFO Don LeClair and the exit of two Ford board members. The guy can be a bit wily, and news later came out that his real reason for shedding the stock was that the was spread too thin. His shares in Ford were backed up against shares in the MGM Casino empire which itself is over extended on some projects. He needed the cash fast to keep his positions in that situation stable.
So, here were are this week still seeing some stability in Ford’s stock as the news continues to pelt at it telling of credit woes of car buyers. Lower gas prices and public calming has helped to get buyers interested in vehicles again, at least those who are credit worthy.
News that GM and Chrysler are looking at merging has everyone watching. GM and Chrysler both are at a crossroads and running low on options. Wall Street has seen Ford to be in a better cash situation to weather the current economic conditions. Ford also has some new products rolling out in a couple of weeks that are sure to show they have a brighter immediate future in showrooms with the 2010 Mustang, Fusion and Mercury Milan.
